Barclays boosted its price target to $238 from 204, investors found out due to communication from the company early in the morning. In spite of this rise Charter Communications (CHTR) stock finished Thursday’s session by 2.91% to $219.04.
The latter company successfully finished its acquisition of Time Warner Cable and Bright House Networks. Now all eyes are on the actual business’s performance as compared to the initial outlooks. The merger closed last week and Charter CEO Tom Rutledge affirmed that the company will continue with their steadfast approach to business and progress with the aim of being the best in their field.
“Current Bright House Networks and Time Warner Cable customers won’t see many changes right away, though in the coming months they will begin to hear more from us about the Spectrum brand,” Charter Chairman and CEO Tom Rutledge said in a statement earlier today.
Founded in 1993 in St. Louis, Missouri, Charter Communications is devoted to offering cable telecommunication services to over 25 million users. With presence in 41 states the company, currently based in Connecticut, offers their services under the branding of Charter Spectrum. It is second only to Comcast when it comes to subscriber numbers; Charter offers a wide array of options when it comes to information, communication and entertainment.
In their official investor news release on their website, Charter communications explains the following:
“The combination of Charter, TWC and Bright House will create a leading broadband services and technology company, serving over 25 million customers in 41 states. The completion of the transactions will drive investment into the combined entity’s advanced broadband network, resulting in faster broadband speeds, better video products, more affordable phone service and more competition, for consumers and businesses. Charter’s network and product investments combined with its consumer friendly operating strategy will also lead to faster customer and financial growth, enhancing career development opportunities for its employees and driving value for shareholders.”
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Analysts estimate that company will reap the fruits of the transaction a few years down the road when the margin to be affected. Integration efforts significantly provide benefits to companies as the administrative and general operational costs go down. Nevertheless, the “equal weight” rating on the stock was reaffirmed by the company.
Barclays considers that Charter’s synergy estimation of $800 million for the merger is conservative and will likely be closer to $1 billion due to reductions in programming costs and better efficiency with customer service and technical operations.
“We have been more cautious on the Charter Communications story till now as operating leverage has taken a while to set in despite multiple years of investment,” the firm said in a note adding that Charter saw meaningful operating weight last quarter.
Charter’s assets definitely show sound strength in several areas, its revenue increase and constant stock price performance are points in favor of the company’s stock reliability. On the other hand, there is a decrease in net income, low operating cash flow and reduced profit margins.